HCC sells highway project in Telangana to IDFC Fund

MUMBAI: Ajit Gulabchand-led HCC has sold a highway project in Telangana to Highway Concession One--in which IDFC Alternatives managed India Infrastructure Fund holds a majority stake--for Rs 64 crore, the Mumbai-based infrastructure developer said Friday.

Highway Concession One will acquire a 74% stake in the road arm Nirmal BOT right away while the balance 26% will be purchased after it receives approval from the National Highways Authority of India. The sale of the project is a part of HCC’s strategy to raise Rs 1,500-2,000 crore to repay loans and get the construction and engineering company out of the corporate debt restructuring programme. Acompany spokesperson told ET that the entire residual debt of Rs 231 crore of Nirmal BOT would be taken over by the new owner.

HCC also said that Nirmal BOT has received an arbitration award in its favour for Rs 16.67 crore, which will be payable to HCC. Reacting to the news, shares of HCC rose more than 4% on Friday to close at Rs 33.85 on the BSE.“This investment is in continuation with our road sector aggregation strategy of acquiring controlling stakes in operating road assets,” said MK Sinha, managing partner and CEO of IDFC Alternatives.

HCC has a portfolio of six road projects constituting four operational projects, including Nirmal BOT, which was the first road project the company executed under the build-operate-transfer model.The project, which connects Kadtal to Armur in Telangana, has been operational for five years and has a total concession period of 20 years.